1. Consolidated and Company only Quarterly Reviewed Financial Statements for the second quarter of 2017 (a copy in Thai and English)

Transcription

1 Ref. No. IVL 007/08/ Aug 2017 The President The Stock Exchange of Thailand Subject: Submission of Quarterly Reviewed Financial Statements and the Management Discussion and Analysis of Indorama Ventures Public Company Limited for the second quarter of 2017 We are pleased to submit: 1. Consolidated and Company only Quarterly Reviewed Financial Statements for the second quarter of 2017 (a copy in Thai and English) 2. Management Discussion and Analysis (MD&A) for the second quarter of 2017 (a copy in Thai and English) 3. Company's performance report, Form F45-3 for the second quarter of 2017 (a copy in Thai and English) Please be informed accordingly. Sincerely yours, (Mr. Aloke Lohia) Group CEO, Indorama Ventures Public Company Limited Company Secretary Tel: +66 (0) Fax: +66 (0)

2 INDORAMA VENTURES PUBLIC CO., LTD (SET: IVL ) MANAGEMENT DISCUSSION AND ANALYSIS (MD&A) FOR THE PERIOD OF 2Q 2017 (CONSOLIDATED) Table 1: Financial Summary - Core Financials of Consolidated Business USD in Millions 2Q17 1Q17 2Q16 2Q17 LTM2Q16 LTM LTM2Q17 YoY% (R) YoY% Total Production (in '000 tonnes) 2,223 2,188 2,319 (4)% 9,056 7,666 18% (1) Consolidated Sales 2,089 2,041 1,889 11% 7,852 6,852 15% PET 1,078 1,020 1,016 6% 4,000 3,794 5% Fibers % 2,157 2,112 2% Feedstock % 3,239 1,971 64% (2) Core EBITDA % % PET (25)% (6)% Fibers % (3)% Feedstock % % Core EBIT % % Core Net Profit after Tax and NCI (US$ M) % % Core Net Profit after Tax and NCI (THB M) 3,769 3,322 2,960 27% 12,568 7,336 71% Core EPS after PERP Interest (THB) % % (2) Reported EPS after PERP Interest (THB) (53)% % Core EBITDA/t (US$/t)) % % Net Operating Debt to Equity Note: (1) Consolidated financials are based upon elimination of intra-company (or intra business segment) transactions (2) Core EBITDA is Consolidated EBITDA less Inventory gain/(loss) whereas Core EPS is Reported EPS less Inventory gain/(loss) and onetime extraordinary items. Segments total may not match to IVL due to holdings segment (3) Periods with Restated or (R) are restated numbers as per the adoption of new and revised TFRS. Executive Summary IVL management is pleased to announce another record quarter that makes 14 consecutive quarters of core EPS growth on a Last Twelve Month (LTM) basis. Core EBITDA 2Q17 up 9% and LTM 2Q17 up 33% Core EBIT (Operating Profit) up 14% in 2Q17 and up 47% for LTM 2Q17 Core EPS up 30% in 2Q17 and up 83% for LTM 2Q17 Management is also pleased to note that 3Q17 is on track to beat year-on-year (YoY) and sequentially (QoQ) in favorable market conditions due to short PET supply by peers actions in order to restructure weak balance sheets. Additionally certain planned turnarounds at IVL in 2Q17 are back in operations since June 17 and are ready to meet market demand in 3Q17. Therefore, the tailwinds in volume and margins are expected to handsomely beat earnings estimates on a fully diluted basis following the exercise of W1 warrants. 2

3 In last nine months, PET has faced considerable secondary raw material price increase from Isophthalic Acid (IPA) impacting 2Q17 PET segment by $13 per ton on YoY basis. Since IPA is a secondary feedstock, it is not part of pass-through pricing formula with customers. Active dialogue is ongoing with customers to recover this cost increase. Aforesaid planned turnarounds in 2Q17 that impacted earnings, in an otherwise good seasonal quarter, and taken together with de-consolidation of India PET business, had a volume impact on IVL of 7% for the 2 nd quarter and 2% LTM; Estate-wide Utility revamp impacted our EOEG facility at Clear Lake, Texas and lowered HVA and Necessity production by over 45KT during a strong margin environment. Since startup, the plant is performing well into 3Q17 with margins remaining strong. Rotterdam PTA expansion required a tie-in shutdown lowering PTA production by 45KT. European market is displaying strength which continues in 3Q17 therefore the doubling of PTA output to replace purchased PTA appears well timed. In Asia, firstly the formation of a 50:50 JV in India in September 2016 led to subsequent deconsolidation of superior margin India PET business and secondly our China PET plant had a planned turnaround in 2Q17 and together the combined impact in Asia was 45KT on reported production YoY. EBITDA impact in Asia together with IPA increase was therefore $9 per ton (YoY) in an otherwise strong season. Figure 1: IVL Quarterly Core EBITDA (LTM) Note: Core EPS for 2013 numbers are not restated by quarters with change in new accounting policy as not material. Though yearly numbers are restated. Figure 2: Global Industry Spreads in PET equivalent (US$/t) The steady improvement seen in IVL s core earnings follows on from IVL s consistent strategy of prudent investments made in the higher-margins HVA businesses, integration into key feedstocks in balanced markets and timely investments in key geographies. These have resulted in a structural change in the earnings quality of the Company. Acquisitions made over the past several quarters and the relentless focus on operational excellence have contributed incrementally in enhancing the core EBITDA of the Company and resultant growth in EPS. Last 12 months has seen steady to stronger integrated industry margins compared to previous period and IVL is a testimony of an announced plan of pursuing earnings-accretive growth in strategic areas. The Industry consolidated margins for integrated businesses, as seen in Figure 2, suggests that the bottom seems to have reached in mid-2016 and there is a gradual uptick in 2017 across the value chain. 3

4 Business Analysis IVL s leadership position in specialty feedstocks; our large position in polyester feedstocks; and our global leadership in PET and Fibers businesses, place us as a uniquely diversified and integrated company in the context of its businesses. The recent acquisition of Glanzstoff s facilities has also started a new facility in China and allows IVL to present a full menu of tire-cords to the global tire industry which is growing at healthy rates. Feedstock now contributes to around 50% of the earnings, making it the single largest segment, and provides IVL the ability to capture a larger portion of the value chain as well as reliably meet customer needs across geographies. Other 50% is contributed by PET and Fibers. On a LTM basis, the higher-margins HVA portfolio contributed to over 50% of the earnings together with diversity of revenue streams and higher returns. Rest was contributed by Necessities. Figure 3: IVL s Business Profile Note: Segments total may not match to IVL due to holdings segment forthcoming quarters. The startup of the PTA expansion project in Rotterdam in 3Q17, the forthcoming completion of the ethylene cracker in USA later this year and the expected doubling of IPA volumes in 2018 will further enhance IVL s unique feedstock portfolio. The completion of the Glanzstoff acquisition in Europe, the acquisition of the balance minority interest (25%) in Trevira as well as the announced projects in China and Indonesia will help grow the HVA portfolio within our Fibers business and will provide further growth impetus to the earnings of the Company in the Indorama Ventures Business Overview The Company expects to continue with its strategy of diversifying its revenue streams within its area of core competence. This same strategy has continued to play a vital role in its ability to deliver industryleading performance and providing a natural hedge against short-term volatility in product margins. Core EBITDA margin has enhanced from 6.4% in 2013 to 11.4% in 2Q17 and this is targeted to further improve from the various strategic projects under implementation. More recently, Returns on Equity and on Capital Employed have surpassed the double-digit level. Specifically, for 2Q17, IVL achieved core ROE of 18.2% and a core ROCE of 12.6%. 4

5 Figure 4: Margins and Returns Note: All ratios are based on US$ calculation Over the past 5 years or so, IVL has invested prudently to create a diversified earning stream via its HVA portfolio. This portfolio, which accounted for 52% of overall core EBITDA, has enabled the Company to deliver robust earnings on a sustained basis. The HVA business targets verticals grows at 6-7% year-on-year. The automotive vertical is a key growth driver for IVL within its rapidly expanding HVA portfolio benefiting from mega-trends like light-weighting, autonomous vehicles and electric vehicles. IVL is at the forefront of developing solutions, providing a unique global manufacturing footprint, an unparalleled product portfolio together with sustainable solutions making it a leading fiber partner for the automotive industry. The recent acquisition of Glanzstoff provides a strategic fit to the automotive segment in the HVA portfolio. Table 2: Production Volumes, Utilization and Core EBITDA/t 2Q17 1Q17 2Q16 2Q17 LTM LTM LTM YoY% 2Q17 2Q16 YoY% Production (000 tonnes) 2,223 2,188 2,319 (4)% 9,056 7,666 18% PET (4)% 3,737 3,628 3% Fibers % 1,387 1,357 2% Feedstock (6)% 3,932 2,682 47% West Feedstock (9)% 2,768 1,553 78% Asia PTA (1)% 1,163 1,129 3% Operating rate (%) 87% 86% 87% (1)% 87% 83% 4% PET 89% 84% 85% 5% 85% 83% 2% Fibers 90% 90% 88% 2% 89% 88% 1% Feedstock 83% 87% 89% (7)% 88% 81% 8% West Feedstock 80% 89% 88% (10)% 89% 81% 10% Asia PTA 90% 83% 91% (1)% 85% 82% 3% Core EBITDA/t (US$/t) % % PET (22)% (9)% Fibers % (5)% Feedstock % % West Feedstock % % Asia PTA (57)% % 5 Final phase of the brownfield expansion in the PTA facility in Rotterdam necessitated a planned turnaround (and hence lower production) at the existing PTA facilities. Planned shutdown at the EOEG facility in USA impacted feedstock production. PET volumes were down due to de-consolidation of India and turnaround in China which impacted EBITDA/t inclusive of the IPA hit on YoY basis. Nevertheless, strength seen in the high-value specialties feedstock gave a tremendous boost to earnings from that segment, wherein core EBITDA/tonne rose by 57% on a year-on-year basis. While EBITDA margin for PET was impacted for Note: Some capacities in 1Q17 are re-rated.

6 precisely this reason, as mentioned previously, IVL on a consolidated basis benefitted and delivered a core EBITDA of $ 107 per tonne in 2Q17. Figure 5 below represents the Annual or LTM breakup of our key segments since Key indicators are; o Growing Production on Year on Year Basis o Growing EBITDA year on year and in line with the Company s vision to double it every 5 years. o The secondary feedstock impact on PET in 2Q17 and 2Q17 LTM was more than fully compensated under the gains in the feedstock segment. o With two sequential quarters yielding triple digit EBITDA/ton, We are confident to henceforth report the same for FY Figure 5: Annual Business Segments-Production Volume and Core EBITDA 6

7 Capital Investments IVL is committed to investing around $ 1.0 billion on identified growth and maintenance-related projects during 2017 to Additionally, and during the same period, the Company believes that there will be financial headroom of around $ 4 billion for further investments based on its projections of internal cash accruals and prudent borrowing. IVL is poised to grow in a disciplined manner and pursue its consistent strategy of prudent investments in higher-margins HVA businesses, integration into key feedstocks and timely investments in key geographies. Table 3: New Projects Start Up in 2H2017 to 2018 No Project Capacity (Kt) 1 US Gas Cracker 440 Kt pa Expected Start Up/ Completion Strategy End 2017 a. ~90% output goes to IVL existing EO/EG facility b. Capturing entire value chain in USA c. Most integrated PET company in North America d. Leverage on abundant shale gas supply in US e. ~90% completed by July2017 Remarks Site Pictures 2 Expansion of HVA Automotive Fibers in China (Performance Fibers) 18 Kt pa 1H18 a. Expand to meet growing demand of tire-cords 3 Expected doubling production of IPA with committed supply of xylene Expected over 100Kt pa increase in production 1H18 a. More committed xylenes from supplier to help increase the IPA production of IVL b. Capture growing demand in PET and other applications of IPA Applications of IPA 4 Greenfield HVA Automotive Fibers in China (Glanzstoff) 2 Kt pa July 2017 a. Expand to meet growing demand of tire-cords Qingdao - Shangdong Top 10 economic developed cities in China Presence of major tire producers 9 million people Qingdao Qianwan Port is 7th Largest in the world Good connectivity with the West and Asia 7

8 Regional Performance Analysis North America On an LTM basis, production in North America has grown following the full year benefit of the acquisition of the integrated PTA and NDC facility at Decatur, Alabama. Margins for the Necessities business expanded with higher volume and the advantage of capturing a larger part of the value chain with the addition of PX manufacturing capability. Earnings from the HVA segment also expanded as a result of higher volume of the specialty feedstock, NDC wherein IVL is the world s only commercial producer. On a Q-on-Q basis however, production (and earnings) of HVA and Necessity were both impacted due to the planned shutdown at the EO-EG facility for a utility upgrade of the entire estate. North America now contributes to 40% of the Company s earnings. Given the extent of integration and growth in its HVA portfolio, the region now earns in comfortable triple digit territory. IVL stands to benefit from margin expansion with the resumption of production of EO-EG since June The commercialization of the ethylene cracker scheduled for later this year will give a healthy boost to our 2018 results and for future years. Figure 6: North America (NA) Segment Note: Holding companies earnings are allocated to regions and all historical are restated accordingly Europe, Middle East and Africa Figure 7: Europe, Middle East and Africa (EMEA) Segment Note: Holding companies earnings are allocated to regions and all historical are restated accordingly 8 EMEA contributes to over 36% of the Company s core EBITDA. As mentioned previously, PTA production at Rotterdam was lower due to a planned turnaround but production on an LTM basis was higher due to the full year benefit of PTA, IPA and PET assets acquired in April Earnings from this region have grown substantially as a result of higher volumes of HVA products as well as improvement in the blended margins of the portfolio. On a per tonne basis, EMEA is the most profitable re-

9 gion for the Company with comfortable earnings/t in triple digits. Earnings from EMEA are set to expand with the doubling of PTA (recently completed). Although the high IPA margins will gradually normalize but we expected them to be more than offset by the doubling of IPA production starting 1H18. Asia Contrary to how the Asian graph reflects lower earnings, business sentiments are starting to improve. EBITDA and ROCE were weak for the quarter and LTM due to de-consolidation on India PET business as explained earlier as well as the planned turnaround at the PET location in China. Strength in secondary feedstocks like IPA which benefitted IVL in the EMEA region impacted the PET business in Asia. Going forward, structural changes taking place in Asia should benefit the industry as a whole. Lack of new announcements in capacity expansions and continued growth in demand is a positive indication of the times to come. IVL, with its meaningful position in the context of the sector stands to benefit from this change in cycle going forward. In the foreseeable future, IVL s earnings from the region is also poised to improve with the planned expansion of the HVA tire cord facility and the setting up of a Glanzstoff facility in China. In addition there is an ongoing expansion for necessities fiber at our Indonesian facility which is due for completion in 2H18. Figure 8: Asian Segment Note: Holding companies earnings are allocated to regions and all historical are restated accordingly 9

10 Notes We recommend that investors always read the MD&A together with the published financial statements to get complete details and understanding. The consolidated financials are based upon the elimination of intra-company (or intra-business segment) transactions. For this reason, the total of each segment may not always tally with consolidated financials. Similarly segments total may not always match to IVL due to holdings segment. Since 1Q2014, IVL has changed the quantity calculation methodology for Fibers and included Packaging business quantities in PET. The impacts of these changes are not material. The Polyester Chain businesses are generally traded in US Dollars and therefore IVL believes in helping its readers with translated US Dollar figures. IVL s reporting currency is in Thai Baht (THB) and the accompanying pages are an integral part of this report. The accompanying pages report the Reviewed THB results and its translation into US Dollars at average exchange rates and closing exchange rates where applicable. Readers should rely on the THB results only. IVL has presented the analysis in the MD&A in US$ as it believe that the business can be explained better in US$ terms. However THB numbers are also given where needed. Readers should rely on the THB results only. Definitions Core EBITDA is after excluding inventory gains/losses from reported EBITDA. Inventory gains/losses in a period result from the movement in prices of raw materials and products from the end of the previous reported period to the end of the current reported period. The cost of sales is impacted by inventory gains/losses wherein inventory gains decrease the cost of sales and inventory losses increase the cost of sales. Core Net Profit is the reported Net Profit less extraordinary items less tax adjusted inventory gain/loss. Net operating debt is defined as net debt (total debt less cash and current investments) less cash outflow for the various projects underway which are not yet completed and have not yet started contributing to the earnings of IVL. Forward-looking Statements The statements included herein contain forward-looking statements about the [financial condition and results of operations] of Indorama Ventures Public Company Limited (the Company ), which are based on management s current beliefs, assumptions, expectations and projections about future economic performance and events, considering the information currently available to the management. Any statements preceded by, followed by or that include the words targets, believes, expects, aims, intends, will, may, anticipates, would, plans, could, should, predicts, projects, estimates, foresees or similar expressions or the negative thereof, identify or signal the presence of forward-looking statements as well as predictions, projections and forecasts of the economy or economic trends of the markets, which are not necessarily indicative of the future or likely performance of the Company. Such forwardlooking statements, as well as those included in any other material discussed at the presentation, are not statements of historical facts but concern future circumstances and results and involve known and unknown risks, uncertainties and other important factors beyond the Company s control that could cause the actual results, performance or achievements of the Company to be materially different from the expectations of future results, performance or achievements expressed or implied by such forward-looking statements. Factors that could contribute to such differences include, but are not limited to: the highly competitive nature of the industries in which the Company operates; a potential recurrence of regional or global overcapacity; exposures to macro-economic, political, legal and regulatory risks in markets where the Company operates; dependence on availability, sourcing and cost of raw materials; ability to maintain cost structure and efficient operation of manufacturing facilities; shortages or disruptions of supplies to customers; operational risks of production facilities; costs and difficulties of integrating future acquired businesses and technologies; project and other risks carried by significant capital investments including future development of new facilities; exchange rate and interest rate fluctuations; pending environmental lawsuits; changes in laws and regulations relating beverage containers and packaging; the impact of environmental, health and safety laws and regulations in the countries in which the Company operates. All such factors are difficult or impossible to predict and contain uncertainties that may materially affect actual results. New factors emerge from time to time, and it is not possible for management to predict all such factors or to assess the impact of each such factor on the Company. Such forward-looking statements are also based on numerous assumptions and estimates regarding the Company and its subsidiaries present and future business strategies and the environment in which the Company will operate in the future. Any forward-looking statements are not guarantees of future performance and speak only as at the date of this presentation, and none of the Company, nor any of its agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or revise any such forward-looking statements to reflect any change in the Company s expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based or whether in the light of new information, future events or otherwise, except as may be required by applicable laws and stock exchange regulations. The above and other risks and uncertainties are described in the Company s most recent annual registration statement (Form 56-1), and additional risks or uncertainties may be described from time to time in other reports filed by the Company with the Securities and Exchange Commission of Thailand and the Stock Exchange of Thailand. Given the aforementioned and other risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements as a prediction of actual results or otherwise. The results of operations for the periods reflected herein are not necessarily indicative of results that may be achieved for future periods, and the Company s actual results may differ materially from those discussed in the forward-looking statements as a result of various factors not foreseen at the time of giving this presentation. This statement must not be treated as advice relating to legal, taxation, financial, accounting or investment matters. By attending this presentation, you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company and of the risks and merits of any investment in the Shares, and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company s business. 10

11 Index Table 1: Financial Summary - Core Financials of Consolidated Business... 2 Table 2: Production Volumes, Utilization and Core EBITDA/t... 5 Table 3: New Projects Start Up in 2H2017 to Table 4: Revenue Breakup by Geography Table 5: Reconciliation of Core Profit after tax and NCI to Reported Net Profit Table 6: Cash Flow Statement Table 7: Debt Profile Table 8: Joint Ventures Performance Table 9: IVL Consolidated Statement of Income Table 10: IVL Consolidated Statement of Financial Position Table 11: Analysts Coverage and IVL Contacts Figure 1: IVL Quarterly Core EBITDA (LTM)... 3 Figure 2: Global Industry Spreads in PET equivalent (US$/t)... 3 Figure 3: IVL s Business Profile... 4 Figure 4: Margins and Returns... 5 Figure 5: Annual Business Segments-Production Volume and Core EBITDA... 6 Figure 6: North America (NA) Segment... 8 Figure 7: Europe, Middle East and Africa (EMEA) Segment... 8 Figure 8: Asian Segment... 9 Figure 9: Repayment Schedule of Long Term Debts

12 Table 4: Revenue Breakup by Geography (1) Total revenues 2Q17 1Q17 2Q16 LTM2Q17 LTM2Q16 LTM YoY% THB in millions 71,661 71,650 66, , ,707 12% USD in millions 2,089 2,041 1,889 7,852 6,852 15% (2) Proportion of revenues by geographic Thailand 6% 7% 6% 6% 6% Rest of Asia 17% 19% 19% 19% 19% North America 38% 38% 35% 38% 36% Europe 33% 31% 32% 31% 30% Rest of the World 6% 6% 8% 6% 9% Note: (1) Consolidated financials are based upon elimination of intra-company (or intra business segment) transactions (2) Breakup by customer sales location Table 5: Reconciliation of Core Profit after tax and NCI to Reported Net Profit LTM LTM LTM USD in Millions 2Q17 1Q17 2Q16 2Q17 2Q16 (R) YoY% Core Net Profit after Tax and NCI % Inventory gain (loss) (22) (67) Total tax on Inventory gain/(loss) 1 (6) (4) (4) 12 Net profit, before extraordinary items % Add: Non Operational/Extraordinary income/(expense) (3) (1) (91)% Acquisition cost & pre-operative expense (3) (2) (1) (9) (3) 207% Gain on Bargain Purchases, impairments and feasibility study (Net)* (0) (97)% Other Extraordinary Income/(Expense) 0 1 (2) 18 (3) = Net profit after tax and NCI % *A gain on bargain purchase needs to be accounted for on completion of any acquisition under Thai Accounting Standards. Table 6: Cash Flow Statement USD in Millions 2Q17 1Q17 2Q16 LTM LTM LTM 2Q17 2Q16 (R) YoY% Core EBITDA % (1) Net working capital and others 19 7 (100) 87 (130) Operating Cash Flow (OCF) % (2) Net growth & investments CAPEX (299) (116) (183) (622) (779) (20)% Net working capital on acquired /sold Asset (30) - (98) (15) (235) (93)% Maintenance Capex (22) (24) (17) (91) (68) 34% Cash Flow After Strategic Spending (93) 85 (178) 238 (550) Net financial costs (42) (21) (41) (129) (114) 13% Income tax (18) (6) (14) (43) (27) 60% Dividends and Perp interest (59) (8) (42) (132) (97) 35% (3) Increase/(Decrease) in Net Debt on cash basis 212 (51) (92)% Note: (1) Includes inventory gain/ (loss) (2) Includes net proceeds from disposals of PPE, other non-current investments and assumed net debt on acquisitions. (3) Includes effect of foreign exchange rate changes on balance held in foreign currencies and on the net debt changes over the period of cash flow, due to which the increase/decrease in net debt as per statement of financial position might be different. 12

13 Table 7: Debt Profile USD in Millions 2Q Total Debt 3,140 2,850 Bank overdraft and short-term loans Long term debt (Current portion) Debentures (Current portion) Long term debt (Non-current portion) 1,533 1,428 Debentures (Non-current portion) 1, Cash & Cash under management Cash and cash equivalents Current investments and loans given Net Debt 2,977 2,722 (1) Non-operating Debt (Project Debt) Net Operating Debt 2,342 2,262 Net debt to equity (times) Net operating debt to equity (times) Debts with fixed interest % 52% 50% Credit Rating by TRIS (Reaffirmed in October 2016) A+ A+ Liquidity (US$ billions) Unutilized credit line (US$ billions) Financial Ratios Current ratios (times) Debt Servicing Coverage Ratio (DSCR) times Interest coverage ratio (times) Note (1) Net debt after debt for Capex and investments in progress that are not generating revenue and earnings as on date given Figure 9: Repayment Schedule of Long Term Debts 13

14 Table 8: Joint Ventures Performance USD in Millions 2Q17 1Q17 2Q16 LTM2Q17 LTM2Q16 Joint Ventures (JV) Income /(Loss) (3) 4 (1) (2) (10) (78)% Ottana Mothballed in (0) (0) (1) (78)% Polyprima, Indonesia (47.25% PTA JV) (4) (2) (1) (12) (11) 7% India PET JV (September 12, 2016 onwards) (1) Others (FiberVisions, PHP China, Mexico) % LTM YoY% 14

15 Table 9: IVL Consolidated Statement of Income Reported Financials THB in millions 2Q17 1Q17 2Q16 2Q17 YoY% LTM 2Q17 LTM 2Q16(R) LTM YoY% Net sales 71,661 71,650 66,730 7% 274, ,707 12% (1) Other income (expense), net (30)% 981 1,472 (33)% Total Revenue 71,878 71,820 67,039 7% 275, ,178 12% (2) Cost of sales 61,567 59,869 55,490 11% 233, ,378 9% Gross profit 10,312 11,951 11,549 (11)% 41,582 31,801 31% (2) Selling and administrative expenses 5,738 5,701 6,051 (5)% 22,273 20,747 7% Foreign exchange gain (loss) (49) (37) (54) (9)% ,300% EBITDA 7,399 9,022 8,389 (12)% 31,302 21,258 47% Depreciation and amortization 2,875 2,809 2,946 (2)% 11,457 10,193 12% Operating income 4,524 6,213 5,444 (17)% 19,845 11,065 79% (3) Share of profit/(loss) from JV (120) 146 (44) 170% (76) (343) (78)% (4) Extraordinary income/ (expenses) (88) (27) 2,485 (104)% 463 5,379 (91)% Net interest (981) (985) (1,077) (9)% (4,041) (3,895) 4% Profit before tax 3,335 5,348 6,808 (51)% 16,190 12,206 33% Income tax expense (59)% 2,505 1, % Current tax expense/(income) (13)% 1,529 1,265 21% Deferred tax expense (264) (114) Profit/(loss) for the period 3,005 4,497 6,007 (50)% 13,684 11,056 24% Non-controlling interests (NCI) % (19)% Net profit/(loss) after NCI 2,937 4,426 5,950 (51)% 13,507 10,836 25% (5) Interest on subordinated capital debentures (PERP) (262) (259) (260) 1% (1,049) (1,051) (0)% Net profit/(loss) after NCI & PERP interest 2,675 4,168 5,689 (53)% 12,458 9,784 27% Weighted average no. of shares (in Millions) 4,814 4,814 4,814 0% 4,814 4,814 0% EPS (in THB) (53)% % Core Financials THB in millions EBITDA 7,399 9,022 8,389 (12)% 31,302 21,258 47% Less: Inventory gain/(loss) (790) 1, (2,280) Core EBITDA 8,189 7,681 7,750 6% 30,682 23,538 30% Net profit/(loss) after NCI 2,937 4,426 5,950 (51)% 13,507 10,836 25% Less: Inventory gain/(loss) tax adjusted (744) 1, (1,880) Less: Extraordinary income/ (expenses) (88) (27) 2, ,379 (91)% Core net profit after NCI 3,769 3,322 2,960 27% 12,568 7,336 71% (5) Interest on subordinated capital debentures (PERP) (262) (259) (260) 1% (1,049) (1,051) (0)% Core net profit after NCI & PERP interest 3,508 3,063 2,699 30% 11,520 6,285 83% Core EPS (THB) % % (6) Net Operating Core ROCE (before JV s and M&A Annualized) % 12.7% 12.0% 11.3% 11.5% 9.1% (1) This by our internal classification and includes insurance claim for business interruption loss of profits (2) This by our internal classification includes depreciation and amortization expenses (3) This by our internal classification excludes impairment expenses (4) This by our internal classification includes gain on bargain purchase on new acquisitions and their related transaction costs, pre-operative expenses. (5) Interest net of tax on THB 15 billion Perpetual Debentures issued in October 2014 (6) M&A earnings annualized in ROCE% calculation to present the ratio appropriately and historical are restated accordingly. ROCE% calculation is based on THB currency 15

16 Table 10: IVL Consolidated Statement of Financial Position THB in millions 30-Jun Dec Jun-17 vs. 31-Dec-16 Assets Cash and current investments 5,256 4,140 27% Trade accounts receivable 33,352 31,085 7% Inventories 41,088 40,459 2% Other current assets 9,336 8,811 6% Total current assets 89,032 84,495 5% Investment 6,380 5,530 15% Property, plant and equipment 142, ,860 4% Intangible assets 28,601 27,257 5% Deferred tax assets 2,306 2,233 3% Other assets 1,831 2,005 (9)% Total assets 270, ,380 5% Liabilities Bank OD and short-term loans from financial institutions 11,204 9,225 21% Trade accounts payable 39,561 37,316 6% Current portion of long-term loans 4,314 4,404 (2)% Current portion of debenture 550 5,499 (90)% Current portion of finance lease liabilities % Other current liabilities 10,889 9,410 16% Total current liabilities 66,559 65,862 1% Long-term loans from financial institutions 51,843 51,168 1% Debenture 38,472 31,790 21% Finance lease liabilities ,042% Deferred tax liabilities 15,562 14,796 5% Other liabilities 3,279 2,938 12% Total liabilities 175, ,566 6% Shareholder's equity Share capital 4,814 4,814 0% Share premium 29,777 29,775 0% Retained earnings & Reserves 43,322 39,592 9% Total equity attributable to shareholders 77,914 74,181 5% Subordinated perpetual debentures 14,874 14,874 (0)% Total equity attributable to equity holders 92,788 89,055 4% Non-controlling interests (NCI) 2,009 2,760 (27)% Total shareholder's equity 94,796 91,815 3% Total liabilities and shareholder's equity 270, ,380 5% Note: The consolidated financials are based upon elimination of intra-company (or intra business segment) transactions. For this reason the total of each segment may not totally with consolidated financials. 16

17 Table 11: Analysts Coverage and IVL Contacts AEC SECURITIES PUBLIC COMPANY LIMITED AIRA SECURITIES PUBLIC COMPANY LIMITED APPLE WEALTH SECURITIES PUBLIC COMPANY LIMITED ASIA PLUS SECURITIES PUBLIC COMPANY LIMITED BUALUANG SECURITIES PUBLIC COMPANY LIMITED CAPITAL NOMURA SECURITIES PUBLIC COMPANY LIMITED CIMB SECURITIES (THAILAND) CO., LTD CREDIT SUISSE SECURITIES (THAILAND) LIMITED DBS VICKERS SECURITIES (THAILAND) COMPANY LIMITED DEUTSCHE TISCO INVESTMENT ADVISORY COMPANY LIMITED FINANSIA SECURITIES LIMITED HSBC, UK JPMORGAN SECURITIES (THAILAND) LIMITED KASIKORN SECURITIES PUBLIC COMPANY LIMITED KGI SECURITIES (THAILAND) PUBLIC COMPANY LIMITED KRUNGSRI SECURITIES PCL KT ZMICO SECURITIES KTB SECURITIES (THAILAND) COMPANY LIMITED LH SECURITIES LIMITED MACQUARIE CAPITAL SECURITIES(THAILAND) COMPANY LIMITED MAYBANK KIM ENG SECURITIES (THAILAND) PUBLIC COM- PANY LIMITED MORGAN STANLEY, SINGAPORE NOMURA INTERNATIONAL PHATRA SECURITIES PUBLIC COMPANY LIMITED PHILLIP SECURITIES (THAILAND) PUBLIC COMPANY LIMITED SCB SECURITIES COMPANY LIMITED THANACHART SECURITIES PUBLIC COMPANY LIMITED TRINITY SECURITIES COMPANY LIMITED UBS SECURITIES (THAILAND) LIMITED UOB KAY HIAN SECURITIES (THAILAND) PUBLIC COMPANY LIMITED YUANTA SECURITIES (THAILAND) COMPANY LIMITED IVL Investor Relations Contacts: Richard Jones (Vice President - Investor Relations, Corporate Communications and Sustainability) Ext: richard.j@indorama.net Vikash Jalan (Joint Vice President - Strategy, Finance and IR, Group CEO Office) Ext: vikash.j@indorama.net 17